Zimbabwe agrees to staff-monitored programme with the IMF

Zimbabwe has reached a staff-level agreement with the International Monetary Fund on economic policies and reforms.

The IMF says the 10-month Staff-Monitored Programme (SMP) is aimed at consolidating recent stabilisation gains and strengthening macroeconomic management.

An SMP with the Fund is an informal agreement that can open the door to an eventual loan. Its intended to establish a credible track record that supports re-engagement efforts and complements a strategy to clear debt arrears and debt restructuring.

Notably, it emphasises prudent budget execution, improved cash and expenditure controls, sustained monetary discipline, and governance reforms to enhance transparency and manage fiscal risks..

The programme does not entail financial assistance or endorsement by the IMF’s Executive Board.

Zimbabwe, which has endured decades of hyperinflation, currency volatility, and dependence on informal dollarized markets, has had previous SMPs.

The last one, launched in May 2019, was abandoned after it failed to stick to the IMF’s recommendations.

In order to secure much-needed fresh financing from international partners, Zimbabwe has to clear its debt arrears.